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Senate Rejects ACA/Exchange Bill

by David Gorn

Thursday, June 21, 2012

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Senate Rejects ACA/Exchange Bill

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If the Supreme Court overturns part or all of the Affordable Care Act in a ruling expected within the next 10 days, California should be ready, according to Senator Tom Harman (R-Huntington Beach).

Harman yesterday introduced SB 1321, which would require the California Health Benefit Exchange to submit a report to the Legislature within 90 days, if the Supreme Court reverses any part of the ACA.

The Senate Committee on Health rejected the measure.

Harman said it's just common sense to require a plan be in place in the event of any legal decisions against provisions of the ACA.

If any part of the ACA is no longer in effect, SB 1321 would give the exchange board 90 days "to tell us how it's going to continue operating if any implementation of the exchange is rescinded," Harman said. "The exchange was created in 2010 with massive federal subsidies, and if that funding dries up, California cannot afford to pick up the tab. We would be in the untenable position of having to provide promised services without the proper funding."

Harman said the bill was motivated by financial concerns.

"This is not an anti-ACA approach," he said. "It is a fiscally prudent approach."

Whether or not it's anti-ACA, it could end up being anti-exchange, according to Beth Capell, legislative advocate for Health Access California.

"When you look at the multitude of tasks ahead of [the exchange board], 2014 does not seem so far off," Capell said. "The way this measure is written, it would result in keeping California from proceeding with health care reform. It's premature and unnecessary, no matter what the court does."

Kelly Hardy, director of health policy at Children Now and legislative advocate for the California Children's Health Coverage Coalition, said it's a specious argument that California somehow will be on the hook for what has been funded by federal dollars. "The exchange is already required not to use state general fund money," Hardy said, "so we see this bill as unnecessary."

Harman said health care reform overall will cost $15 billion in federal money. "So what happens if that money goes away?" he asked. "We should have a plan as to how we're going to go forward if that happens. What's wrong with having a plan?"

Senator Lois Wolk (D-Davis) said a plan would need to be worked out, depending on what the Supreme Court decides, but it would be detrimental, she said, to halt all exchange work pending submission of a long legal and legislative analysis and report.

"I do think it's premature," Wolk said. "It's too Draconian for my taste. I do think we have a problem if part of the ACA is overturned. And we will have something to deal with then."

Senate health committee chair Ed Hernandez (D-West Covina) also voted against the measure. "My concern is, we don't know what might be overturned," Hernandez said. "And even if it is overturned, it's important to have the exchange up and running, so we can decide what we want to do."

The measure, which needed five votes to survive, failed on a 3-4 vote. Hernandez said the bill was granted reconsideration at a future date.

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About Capitol Desk

Capitol Desk is a daily report covering health care policy and politics from California Healthline's Sacramento Bureau. Have an idea? Let us know.

About David Gorn

Senior Reporter David Gorn is based in Sacramento and covers health care and policy. He has been deputy news director of KQED public radio, a reporter for National Public Radio, and an editor at a number of newspapers and magazines across Northern California, including the Santa Rosa Press Democrat and San Jose Mercury News. Gorn has also taught journalism at San Francisco State University. You can email him at capitoldesk@chcf.org.

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